Bitcoin ATMs are expected to experience a surge in installations worldwide following the Bitcoin halving, a period known for increased crypto FOMO (fear of missing out), according to the CEO of a major Bitcoin ATM operator.
In 2023, there was a decline in crypto ATM installations for the first time in a decade, likely due to a bear market exacerbated by the collapse of several crypto companies. However, Brandon Mintz, CEO of Bitcoin Depot, states that 2024 has started on a positive note, with 1,469 crypto ATMs installed in the first three months, compared to over 3,000 removed during the same period in 2023, according to CoinATMRadar data.
Mintz believes that the industry is on the verge of an ATM rebound, as Bitcoin has already surpassed its all-time high twice in March. He notes that during previous bull markets, crypto adoption and the number of customers increased during the FOMO phase towards the end of the cycle. However, Mintz believes it is still early in the cycle, with the halving event scheduled for late April, which historically leads to a surge in price and FOMO.
While the number of ATMs has increased recently, Mintz reveals that the number of ATM operators has actually decreased over the past 18 months. One of the largest operators, Coin Cloud, with 5,000 ATMs, filed for bankruptcy in February 2023. Mintz mentions that many other operators struggled and went out of business, which was not publicly disclosed. This decline occurred rapidly after the collapse of crypto exchange FTX in November 2022.
Bitcoin Depot reported a 7% year-on-year increase in full-year revenues to $689 million in 2023, although net income dropped by 54% to $1.6 million. The company has plans to install 900 ATMs in the first quarter of 2024 and an additional 940 ATMs in convenience stores across 24 US states.
CoinATMRadar data shows that Bitcoin Depot is one of the major players in the Bitcoin ATM market, along with Coinflip and Bitstop. The United States is home to nearly 83% of the world’s 37,001 crypto ATMs, with over 30,600 located in the country.
The recent approval of spot Bitcoin exchange-traded funds (ETFs) in the US is seen by some as a catalyst for institutional and retail investors to enter the Bitcoin market. However, Mintz believes that Bitcoin ATMs cater to a different customer base, primarily those who transact in cash due to being underbanked or unbanked. He suggests that the increase in Bitcoin’s price driven by ETFs could lead to more ATM usage as Bitcoin adoption continues to grow.
In conclusion, Bitcoin ATMs are poised for global growth following the Bitcoin halving, with the CEO of Bitcoin Depot predicting increased installations and usage as crypto adoption expands. The recent decline in ATM installations and the decrease in the number of operators are expected to be reversed, and the approval of Bitcoin ETFs is not seen as a threat to the ATM industry.